Nasser Saidi, former Chief Economist of the Dubai International Financial Center, is a former vice governor of the Bank of Lebanon and has served as Lebanon’s Minister of the Economy and Industry. He is the author, most recently, of the OECD report Corporate Governance in the MENA Countries.

Nasser Saidi wonders whether Lebanon could "escape the resource curse." There was much euphoria in 2010 when a US geological survey estimated that there were 122 trillion cubic feet of gas and 1.7bn barrels of oil off the coasts of Israel, the Gaza Strip, Cyprus, Syria and Lebanon. There was hope that these discoveries would open up new economic opportunities and fulfill dreams of a prosperous future.With an appointed president, ending two-and-a-half years of political deadlock in Lebanon, the author says the government should focus on exploiting its offshore gas and oil reserves. The potential benefits of a domestic supply are evident, ending a reliance on expensive imported fuels. Energy exports would provide a magical solution for many of Lebanon's ills - chronic public debt and poor public services. People - particularly in Beirut's most affluent neighbourhoods - are fed up with power shortages. But it will take years to reap these benefits, as it requires hard work and investments. Besides the ongoing war in Syria could also disrupt development of Lebanon's resources as violence spills over.Despite the hydrocarbon boon, the author warns against its pitfalls and urges the government to forge political reforms. 1) Prices are volatile and have "declined by some 60% since June 2014," and a recovery is unlikely any time soon. Russia and Saudi Arabia are grappling with stalling economies. 2) It's still unclear how large is Lebanon’s share of "recoverable energy reserves," and whether the country has the technology and know-how to manage the industry. 3) Territorial disputes and the "absence of agreed maritime borders with Cyprus, Israel, and Syria" are political obstacles to overcome. Moreover Israel and Lebanon remain technically at war. 4) Lebanon needs to "deal with its dysfunctional politics and dismal governance. " Governments have been fragile and the country has not yet fully recovered from its decades-long civil war.The four steps the author proposes aim to build a wealth fund that serves to secure the sustainability of the natural resources and their potential windfalls. The complex ethnic-sectarian make-up in Lebanon is often the source of domestic bickering and communal tension. On the one hand, there is resistance from some political forces which are not used to making such big businesses transparently and without siphoning any transactions into their pockets. On the other is the long-term concern of some regional powers, which see Lebanon becoming a serious rival once it starts producing oil and eventually sells it to Europe. These regional powers have enormous influence on members of the Lebanese government.The author is right about "the stakes for Lebanon /being/ high." There are two paths for this "troubled country in a tumultuous region" to choose. "It could transform itself if it soundly and efficiently manages its prospective oil and gas wealth. Or it could succumb to the curse, which would entrench the country’s waste, nepotism, corruption, and inequality."In theory "Lebanon’s oil and gas wealth belongs to all of its citizens, current and future." Unfortunately rulers and leaders in the Middle East see natural resources as their own property and cash in the revenues. Graft and corruption were one of the grievances that spawned the Arab Spring.As Lebanon is an exception in a volatile region, it remains to be seen, whether "the new leadership /can base/ its decision-making on a national consensus." The author says a "governance framework that ensures transparency, disclosure, and accountability" would dispel the curse, allowing others in the region to learn and emulate its success. It will not happen as long as the war in Syria doesn't end and the Israel-Palestinian conflict remains unresolved.﻿Read more

Lebanon? Is there such a country? 10 Million Lebanese+ Living outside their country, 10 million Lebanese + of Lebanese decsent living outside their country, 3 Million inhabitant add to them 3 million refugees. A piece of land that is divided by sectarian rulers whom have been sharing its wealth since ottoman days and has been hijacked by gangsters ever since it gained its so called independence. Do you call this a country? Read more

PS On Air: The Super Germ Threat

NOV 2, 2016

In the latest edition of PS On
Air
, Jim O’Neill discusses how to beat antimicrobial resistance, which
threatens millions of lives, with Gavekal Dragonomics’ Anatole Kaletsky
and Leonardo Maisano of
Il Sole 24 Ore.

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